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The latest investment comes despite the fact that Stripe competes with Ramp directly in its corporate cards business.
Stripe has invested in US fintech start-up Ramp for the third time in less than a year in a new funding round valued at $750m today (21 March).
Ramp, which provides corporate cards to help businesses spend less, has been growing rapidly and now finds itself valued at $8.1bn as demand for its products continues to soar. Stripe has been heavily investing in Ramp despite being in direct competition with the start-up through its own corporate card business in September 2019.
The round, which includes $200m in fresh equity funding, was led by San Francisco-based VC firm Founders Fund, which counts some big names in tech among its founders and backers, including PayPal’s Peter Thiel and Ken Howery.
Other major backers for Ramp include D1 Capital Partners, Thrive Capital, Redpoint Ventures, General Catalyst, among many other institutional investors.
The fintech also bagged $550m in debt financing from Citi and Goldman Sachs. The latest funding brings its total investment raised to date to more than $1bn.
Stripe has been investing continuously in Ramp since it was founded in 2019 by Eric Glyman, Karim Atiyeh and Gene Lee in New York. In April last year, Stripe took part in a $115m funding round that valued the company at $1.6bn – only to pump a further investment into the start-up that brought the valuation to nearly $4bn.
‘Overhaul an industry’
Ramp was recently named the most innovative finance company in the world by Fast Company, which also crowned Stripe as the overall most innovative company in the world.
Along with its corporate cards, the start-up also provides expense management software for more than 5,000 businesses currently using its platform – powering more than $5bn in annual payments volume.
Glyman, who is also the CEO of Ramp, said that the start-up is “pursuing an extraordinary opportunity to overhaul an industry that historically has been misaligned and out of touch with the needs of its customers”.
He said that Ramp has helped businesses save more than $135m to date and significantly sped up the time taken for them to close their books – bringing it down from “the industry median of eight days” to just eight hours.
“None of our competitors can say the same. With this funding, we will continue to help even more businesses manage their money easier, faster, and smarter,” Glyman added.
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